I have just watched TVNZ ONE News on Monday night where, among other things, they reported gleefully on the fact that a number of businesses may be up for prosecution for claiming the wage subsidy when they didn’t need it. They behave as if every business owner is a criminal; trying to rip off the system in any way humanly possible.
That was not my experience at all with employers at the time.
I am limited to a relatively few businesses, of course, but not one of them adopted the approach of trying to rip off the government. Several of them actively did not want to apply for the subsidy. Some said quite categorically that they did not want to apply for it; they saw it as a form of failure if they were not able to get through a lockdown and a major pandemic without government help. Some of them never did, even though they qualified. These people should be applauded, not hounded by the media.
The overwhelming sentiment at the time – around the end of March – was uncertainty. No one knew what was going to happen. No one knew how long the lockdown would last. No one knew what would happen after that. Many of them had no idea if they would still have a business at the end of it, whenever the end of it was going to be.
People like me encouraged all of them to apply for the subsidy if they thought they would qualify, which, in the first tranche, only meant a 30% drop in income. There isn’t much doubt about that if you are going into lockdown for an unspecified period. For the second tranche, I have actually looked at the numbers for every single client who applied. If they were not showing a 40% drop in income for a 1-month period, they were advised not to apply, and no one, to my knowledge, did so. Again, one or two have said they don’t want to apply anyway, whether they qualify or not. I admire this sentiment immeasurably, but I advised them in every case to apply for it if they meet the criteria.
Yes, I have heard stories, and in fact know of a few cases of legal and accounting firms who have applied, and in all honesty, they probably could never justify it. Unlike hairdressers or cafes, who will never recover the 2 months of income that they have lost, legal and accounting firms just have to set up their staff to work from home, with logins to their office software (many of whom have already got these systems in place) and they are unlikely to lose a significant amount of their annual income. Trust these people though to take advantage of everything that is on offer; although, to be fair, I understand that many have repaid the subsidy because, as it turned out, they didn’t need it. Well, there’s a surprise.
I am not saying that there are no business people who have taken advantage of the system. There are always people like this, but they are, I believe, in the minority. I work with a fair number of business owners, and they are all decent and honourable people. To be treated as criminals on a regular basis by the media is disgraceful and unwarranted. But what do you expect from a biased, anti-capitalist, business unfriendly media? Employees all, they have no idea how hard it is to run a business. Clearly, they don’t care either.
If you enjoyed this BFD article please consider sharing it with your friends.
